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Thailand Helps Launch Regional Bond Fund - 2003-06-09


Thai Prime Minister Thaksin Shinawatra says the new regional bond fund is all about breaking what he calls the "vicious circle underlying the problem of liquidity." The billion-dollar Asian Bond Fund is backed by 11 of Asia's strongest economies, including China, Japan, South Korea, and Singapore.

The fund will focus on investing in regional government bonds. The leaders of Malaysia and the Philippines both say it is important for the bonds to be denominated in local currencies rather than the U.S. dollar. Prime Minister Thaksin says Asian countries hold more than half the world's reserves, and the fund will help them direct capital towards each other -rather than outside the region.

Meanwhile, Asian governments are readjusting after the SARS viral outbreak hit some financial sectors hard over the past few months.

The chairman of one of Asia's largest container port operators has an optimistic prognosis for China's export economy in the second half of the year. Fu Yuming of China Merchants Holdings say if there is no big fluctuation in SARS cases in Hong Kong, Guangdong and the mainland in the next six months, the Chinese economy and exports would not be affected.

Regional airlines are starting to plan for a post-SARS economy. Singapore Airlines and Malaysian Airlines are among carriers planning to gradually restore slashed flight schedules in the near future. South Korea's Korean Air plans to restore its route between Incheon and Nagasaki, Japan. And Thai Airways says daily flights to North America will resume next week.

Other carriers, such as Hong Kong's Cathay Pacific, Japan Airlines, and Australia's Qantas are taking a more conservative approach. They say they will be keeping an eye on travel volumes in the coming months.

Australia is considering launching a new tourism agency to help revamp its image to world travelers. But instead of going for quantity of visitors, the agency plans to market Australia as what it calls a "platinum-plus" destination. A 10 year strategy will aim to attract wealthier travelers to niche activities like camping, food and wine, and retirement pursuits.

Tourism supports more than half a million jobs in Australia. International visitor numbers have plunged to five-year lows during the SARS crisis.